New Update: What You Need to Know About the Senior Worker Support Package 2023: Up to S$125,000 Grants for Companies

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COVID-19: Senior Worker Support Package 2023

The article was published on 2 March 2021 and was most recently updated on 17 March 2023

Singapore is currently facing an increasingly aging population, with almost half of Singapore’s population expected to be elderly by 2050. The participation rate of senior workers aged 65 and above in the Singapore workforce has also been increasing yearly, with 28.7% in 2019 compared to 17.6% in 2010. Many old Singaporean workers also need to work longer or re-enter the workforce after retirement to support themselves.


To promote employment and retention for senior Singaporean workers, a S$1.3 billion Senior Worker Support Package was announced in Budget 2020. The package will benefit around 110,000 companies and 570,000 workers over three years until 2022.

Senior Employment Credit (SEC)- Extended to 2025

The Senior Employment Credit scheme helps employers transition to higher Retirement Age and Re-employment age through wage offsets. The SEC scheme also aims to increase the employability of and encourage the retention of senior Singaporean workers.


The Government offers salary offsets under the SEC to assist companies that employ Singaporeans in adjusting to the increased Retirement Age and Re-employment Age. The elder age groups will receive more assistance.



The pay offset applies to Singaporean workers aged 55 and above earning up to $4,000 per month in 2021 and 2022.

Who qualifies for the SEC?
Employers that employ Singapore citizens aged 60 and over, earning a monthly compensation of up to $4,000, and have paid timely statutory CPF payments for the employee would be eligible for the payout from 2023 to 2025.
To find out how much your company is eligible for SEC, refer to the FAQ section of the SEC website and any enquires to here.

Central Provident Fund (CPF) Transition Offset scheme

Due to the increase of CPF contribution rates in 2024, a one-year offset of 0.25% of wages will be provided for every Singaporean and Permanent Resident worker aged above 55 to 70. This will help companies to alleviate the rise in business costs from CPF contributions.


The offset will be calculated based on employees’ incomes paid up to the CPF salary ceiling of S$6,300 per month starting 1st September 2023.

Currently, the CPF salary ceiling is set at S$6,300 in 2023


Who qualifies for the Central Provident Fund (CPF) Transition Offset scheme?

Employers that employ Singapore citizens aged 60 and over, earning a monthly compensation of up to $4,000, and have paid timely statutory CPF payments for the employee would be eligible for the payout from 2023 to 2025.





Below table shows the changes of CPF contribution rates by both Employer and Employee in summary:

Age Range

2016-2021

From 1 Jan 2022

From 1 Jan 2023

From 1 Jan 2024

By ~2030

≤55

37.0%

No Change


>55 – 60

26.0%

28.5%

29.5%

31.0%

37.0%

>60 – 65

16.5%

18.5%

20.5%

22%

26.0%

>65 – 70

12.5%

14.0%

15.5%

16%

16.5%

>70

12.5%

No Change






















Aside from the above-mentioned, a total of S$100 million has also been set aside for another two grants over three years. They are the Senior Worker Early Adopter Grant and the Part-Time Re-employment Grant:

 

Do you know that by implementing a higher internal retirement age and re-employment age ahead of time, and employers committing to provide part-time re-employment opportunities to senior workers, a company can claim up to S$250,000 S$125,000 worth of grants?

 

* The increase in the internal RA and REA of a minimum of 3 years (from existing statutory RA and REA of 62 and 67, respectively) to qualify for the SWEAG would be applicable only if companies apply for the grant before 5 July 2021

If the application of the grant is on 5 July 2021 or after, companies would have to raise their internal RA and REA to at least 66 and 71, respectively, i.e., a minimum of 3 years from the new RA and REA of 63 and 68 respectively that would take effect on 1 July 2022. This allows senior workers in these firms to benefit fully from three years of higher internal RA and REA, which is what SWEAG is designed to promote.

Payout: 



Senior Worker Early Adopter Grant (Ceased in Dec 2022)


Companies that raise the ages by three or more years above the prevailing statutory periods will receive S$2,500 per senior worker aged 60 and older from the Senior Worker Early Adopter Grant, capped at 50 workers.



Companies will be required to change their human resource policies and employment contracts and communicate the changes to their employees.


** The increase in the internal RA and REA of a minimum of 3 years (from existing statutory RA and REA of 62 and 67, respectively) to qualify for the SWEAG would be applicable only if companies apply for the grant before 5 July 2021

If the application of the grant is on 5 July 2021 or after, companies would have to raise their internal RA and REA to at least 66 and 71, respectively, i.e., a minimum of 3 years from the new RA and REA of 63 and 68 respectively that would take effect on 1 July 2022. This allows senior workers in these firms to benefit fully from three years of higher internal RA and REA, which is what SWEAG is designed to promote.

Part-Time Re-employment Grant - Reinstate after Budget 2023

In addition, a new Part Time Re-employment Grant has also been introduced to provide up to S$125,000 to companies that commit to providing part-time re-employment opportunities to senior workers who have requested it.

Many employers currently do not have work structures and processes to support such part-time options for senior workers. However, through consultations and surveys done by the Tripartite Workgroup on Older Workers, it was observed that many senior workers would like to reduce their work intensity gradually as they approach retirement. They are also prepared to remain in the workforce if they can undertake part-time work arrangements during re-employment.

As such, the Part-time Re-employment Grant has been introduced from 1st July 2020 onwards to support employers in restructuring their work structures and processes to accommodate more part-time work arrangements for senior workers.


The Tripartite Standard on Age-Friendly Workplace Practices specifies a set of gooage management practices that all employers should implement at the workplace.

Employers who adopt this Tripartite Standard treat older workers fairly and provide them with support in areas such as training and workplace health programs.

Purpose of this Tripartite Standard

  1. Many older employees would want to work longer and stay productive if the workplace is conducive and inclusive. Age-friendly workplaces also help employers attract and retain these employees and tap into their wealth of experience.

Practices you need to adopt this Tripartite Standard

  1. Age is not a selection criterion used when advertising for, shortlisting, or selecting job candidates.

  2. A member of senior management is appointed to champion age-friendly workplace practices.

  3. Older employees are trained to perform their jobs effectively.

  4. Workplace health programs for older employees are implemented.

  5. Jobs and workplaces are designed to be age-friendly.

  6. Older employees who are not at the maximum of their salary ranges and have satisfactory work performance are given annual increments, while other employees are also given yearly increments.

  7. Employees are engaged in re-employment issues at least six months before retirement age 62 and for any subsequent extension of the re-employment contract. Employees are offered re-employment contracts at least three months before they are to be re-employed, with a duration of at least one year.

 
Frequently Asked Questions:

1) What is Employment Assistance Payment? 

If your employer has exhausted all internal re-employment possibilities and is still unable to find you a suitable position, the firm may award you an Employment Assistance Payment (EAP).


The EAP payout is:


- Only as a last resort, following a comprehensive evaluation.

- Designed to tide you over while you look for alternative work.

- A one-time payment of 3.5 months' income, with a minimum of $6,250 and a maximum of $14,750.



Note:

Employees who have been re-employed for at least 30 months since the age of 63 may be eligible for a lesser EAP amount of two months' wages, subject to a minimum of $4,000 and a maximum of $8,500.


Employers are urged to give outplacement services, in addition to the EAP, to help employees locate alternative jobs.

2) Who are the administrators for this grant? 

SNEF and E2i



Read also: SGUnited Mid-Career Pathways Programme: More Than 13,000 Job Attachments Available for Mid-Career Job Seekers and SMEs
Read also:
COVID-19: 5 Government Initiatives for SMEs Hiring Local Workers 2020
Read also: COVID-19: Smart Towkay's Essential Business Survival Guide 2020

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